 "Market tanks as US Fed hints brisk hikes next year")
The benchmark indices, on Thursday, pared initial losses even as the US Federal Reserve raised interest rates by a quarter point on late Wednesday and signalled a faster pace of increases in 2017 and 2018, heightening fears that higher interest rates in US would trigger foreign investment outflows from emerging markets including India towards the US.
After a weak start that saw the S&P BSE Sensex slip nearly 170 points, the markets picked up pace as trade progressed. At 11:45am, the Nifty 50 index was trading nearly 16 points lower at 8,166 levels, while the S&P BSE Sensex as trading 40 points lower at 26,563 levels.
“Wednesday’s trades remained within the 8,160- 8,235 band but with increasing bias towards the lower range. This suggests that a new range would be set today,” said brokerage Geojit BNP Paribas in a technical note.
“The 8,095 region is likely to arrest early downside attempts, but upside prospects look even more limited today and push above 8,160 may only dilute bearishness, and will not usher in fresh buying interest. Directional downsides aiming 7,800 are less expected, but can be played once 8,070 gives away convincingly,” the brokerage added.
Meanwhile, on Wednesday, foreign investors sold equities worth Rs 632.29 crore, while domestic investors bought equities worth Rs 210.86 crore.
BUZZING STOCKS
Bharti Airtel, Sun Pharma and ONGC were the top losers on Sensex and fell 1% each.
Shares of Nalco tanked over 6% after the company posted nearly 52% decline in its net profit at Rs 121.23 crore for the September quarter. The company had reported net profit of Rs 250.85 crore in the same quarter last year.
BUZZING STOCKS
Bharti Airtel, Sun Pharma and ONGC were the top losers on Sensex and fell 1% each.
Shares of Nalco tanked over 6% after the company posted nearly 52% decline in its net profit at Rs 121.23 crore for the September quarter. The company had reported net profit of Rs 250.85 crore in the same quarter last year.
FED HIKES RATES FOR FIRST TIME IN A YEAR
In a unanimous decision, the Federal Open Market Committee (FOMC) raised the target federal funds rate by 25 basis points to between 0.50% and 0.75% as the Trump administration took over with promises to boost growth through tax cuts, spending and deregulation.
"In view of realised and expected labour market conditions and inflation, the committee decided to raise the target range," said FOMC in its statement after a two-day meeting.
"Job gains have been solid in recent months and the unemployment rate has declined," the Fed said, noting that market-based measures of inflation compensation had moved up "considerably."
DOLLAR NEAR 14-YEAR PEAK
The dollar hovered near a 14-year peak against a basket of major currencies on Thursday, receiving a major boost after the Federal Reserve increased the number of projected interest rate hikes for 2017.
The dollar index stood at 102.17 after rising to 102.350 late on Wednesday, its highest since January 2003.
GLOBAL MARKETS
Asian markets struggled on Thursday after US stocks fell the most in two months overnight after Fed outcome. China’s Shanghai Composite was down 0.29% to 3,131.31, Hong Kong’s Hang Seng index slipped 1.70% to 22,074.29, while Japan’s Nikkei dipped 0.19% to 19,225.24.
Late on Wednesday, the Dow Jones industrial average fell 118.68 points, or 0.6%, to 19,792.53, the S&P 500 lost 18.44 points, or 0.81%, to 2,253.28 and the Nasdaq Composite dropped 27.16 points, or 0.5%, to 5,436.67.
